Opinion: The public-private key to unlocking $1.3T in climate finance
How do we make the "Baku to Belem Roadmap" for climate finance a reality?
By Wendy Walford, Erich Cripton // 10 April 2025The promise of $300 billion annually in climate finance for lower-income countries by 2035 — recently announced at COP29 — marks significant progress from the $100 billion commitment made in Copenhagen 16 years ago. It also forms part of a larger target, also agreed at COP29 in Baku, Azerbaijan, as part of the new collective quantified goal, or NCQG, that mobilizes $1.3 trillion per year in financing by 2035 from public and private sources. This “Baku to Belem Roadmap to 1.3T” aims to set out the concrete actions needed to make these goals a reality. Success hinges on collaboration between the private and public sectors. Without private sector engagement, this target will remain out of reach. Opportunities aplenty from productive financing With low- and middle-income countries facing an annual mitigation financing gap of $455 billion to $584 billion and adaptation financing needs of $215 billion to $387 billion, a successful delivery of the Baku to Belem road map will not only unlock vital funding but will build trust between parties and set the stage for meaningful progress in this critical decade for the net-zero transition. For the private sector, mobilizing productive financing in the region of hundreds of billions of dollars offers abundant opportunities. Net-Zero Asset Owner Alliance, or NZAOA, members reached total exposure to climate solutions of $555 billion by end of 2023. Embracing the net-zero mission also brings positive impacts on social and nature considerations, promoting equitable access to clean energy, creating green jobs, and conserving biodiversity for future generations. But the current policy environment is not sufficiently supportive to scale private capital mobilization. Asset owners have the incentive and expertise to act on climate Facing mounting financial risks from the wildfires, extreme weather events, and infrastructure damage caused by climate change, asset owners see clear opportunities for improved returns in a low-carbon economy. Most asset owners have longer investment horizons and therefore work to ensure their assets have value 10-15 years down the line, avoiding stranded assets. And a smooth transition to a low-carbon economy is better for portfolios over the long term — it is in line with asset owners’ responsibility toward their beneficiaries, stimulates economic growth, job creation, and human capital development, and has the potential to reduce inequalities within and between countries. These are all key tenets of ensuring a just transition. With nearly 87 members from 18 countries managing assets of $9.5 trillion, NZAOA brings together financial experts to tackle climate risk — potentially many times more disruptive than the 2008 financial crisis — and offers investors guidance to scale blended finance and mobilize private capital. These insights are crucial for shaping the Baku to Belem road map. NZAOA experts are primed and ready to share knowledge with those developing the road map to help it meet its ambitious and much-needed goals. How the Baku to Belem road map can scale private climate finance The road map is about getting climate finance to where it is needed most — to LMICs, which are often on the front line as the impacts of a changing climate manifest, and which pose a growing climate risk through emission-heavy development, if left to develop unsupported. But, as with any action on a global scale, this is a complicated process. A successful road map should seek to lessen existing policy and regulatory barriers as well as technical challenges that currently impede institutional investors from deploying at scale in these markets. With these barriers to investment addressed, the mandated nationally determined contributions and their implementation can provide a policy-enabled pathway to unlocking the private investment required. As the dangerous impacts of climate heating continue to be felt globally, policymakers, the private sector, and global communities must come together to secure a sustainable and economically viable future. The NZAOA stands ready to work with COP presidencies and all parties to the U.N. Framework Convention on Climate Change, providing expertise and support to shape a road map that delivers on its $1.3 trillion target. Asset owners are not just participants. They are essential partners in unlocking the financial flows required to confront the global climate crisis. Keen to know more? Learn how a group of financial institutions suggest scaling private capital mobilization here.
The promise of $300 billion annually in climate finance for lower-income countries by 2035 — recently announced at COP29 — marks significant progress from the $100 billion commitment made in Copenhagen 16 years ago.
It also forms part of a larger target, also agreed at COP29 in Baku, Azerbaijan, as part of the new collective quantified goal, or NCQG, that mobilizes $1.3 trillion per year in financing by 2035 from public and private sources. This “Baku to Belem Roadmap to 1.3T” aims to set out the concrete actions needed to make these goals a reality.
Success hinges on collaboration between the private and public sectors. Without private sector engagement, this target will remain out of reach.
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Wendy Walford is head of nature and climate risk at Legal & General, focusing on integrating climate and nature risks into financial frameworks. She is also a member of the Institute and Faculty of Actuaries sustainability board and co-lead of the policy track for the Net Zero Asset Owner Alliance.
Erich Cripton joined CDPQ in 2022 and relocated to the New York office in 2023. CDPQ is a global investor group with $473 billion CAD of assets under management. In New York, Erich is responsible for CDPQ’s U.S. government relations across the federal, state, and municipal level as well as managing U.S. regulatory affairs on behalf of CDPQ’s family of asset classes. In addition, Erich leads CDPQ's global thought leadership in areas focussed on sustainability and blended finance and is co-lead of the policy track for the Net Zero Asset Owner Alliance.